Disappointment over Senate's rejection of 1099 Health Care Tax Repeal

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The National Lumber and Building Material Dealers Association (NLBMDA) expressed disappointment again today at the rejection of a newly revamped Johanns Amendment to the Food Safety Bill by a 61-35 vote, which would have repealed the onerous 1099 healthcare tax.

"Senators on both sides of the aisle, President Obama, even House Speaker Nancy Pelosi have all come out in support of repealing this burdensome provision, and yet the Senate refuses to pass a repeal for a third time," said NLBMDA president Michael O'Brien, in a prepared statement. "What is it going to take for our Senators and Representatives to stop the party politics and get back to working for the American people and job creators, namely small businesses? NLBMDA will continue to fight for repeal, and we urge all of our members to contact their Senators to not only express their frustration with the recent votes, but to continue to urge the repeal of a provision that will significantly hurt lumber dealers and small businesses across the country and severely weaken the already fragile economy."

The repeal effort was led by Sen. Mike Johanns (R-NE). To pass, this particular amendment needed a 2/3 majority, which is 67 votes in the Senate. The Johanns Amendment would pay for the repeal with other federal spending cuts.

In addition, the Senators had another shot at repeal with the introduction of the Baucus Amendment by Senator Max Baucus (D-MT). This amendment would have repealed the 1099 provision with no offsetting spending cuts. It was soundly defeated by the Senate with a 44-53 vote. This too needed 67 votes for passage. In all, three votes have been taken by the Senate to repeal the provision, and all three have been defeated.

According to Section 9006 of the 2,409-page Patient Protection and Affordable Care Act, all businesses will be required to send 1099 tax forms to every company or individual from which they purchased more than $600 in services and goods throughout the tax year, beginning Jan. 1, 2012. The new 1099 requirement is expected to generate $17 billion over 10 years to help pay for the new healthcare bill.